✨ Financial Statements Continuation
5 AUGUST 2004 NEW ZEALAND GAZETTE, No. 95 2389
4. Financial Instruments
Investments are stated at market value as at balance date. Accrued interest, accounts payable and donations approved not yet paid are stated at the amounts expected to be received or paid. Accordingly, the trustees consider that the fair value of each class of financial assets and financial liabilities is the same as the carrying value in the financial position.
Concentration of Investments
Ninety-nine point nine percent (99.9%) of the assets of the trust are represented by investments held with a range of financial institutions. However, the trustees consider the risk of non-recovery of these investments to be minimal. Maximum exposure to credit risk as at balance date is:
| 2004 $(000) | 2003 $(000) | |
|---|---|---|
| Bank balances | 8 | 80 |
| Bank term deposits | 2 | 90 |
| Accounts receivable | 31 | – |
| Interest free loans | 30 | – |
| Investments | 118,958 | 106,261 |
Currency Risk
The trust incurs currency risk as a result of investment transactions entered into by fund managers. The trust has a policy of fully hedging global bonds and fifty percent (50%) hedging global equities.
Interest Rate Risk
The following investments of the trust are sensitive to changes in interest rates: Bank call accounts and deposits, government and local authority securities, and securities held by fund managers.
Fair Value
The carrying value is considered to be the fair value for financial instruments.
5. Investments
The value of investments which are held in equities and fixed interest are subject to market fluctuations. The total investment portfolio is diversified in such a way that over time reductions in value in particular asset classes should be more than offset by increases in other classes. Investments are disclosed at market value at balance date and any gains (losses) arising from that treatment are shown as “investment gains (losses)” in the statement of financial performance. Therefore, no provision has been made for potential gains or losses that could occur due to future market fluctuations. The investment portfolio as at 31 March 2004 is diversified as follows:
| Asset | Tower Asset Management | AMP Capital Investors | Russell International Share Fund | Total |
|---|---|---|---|---|
| New Zealand equities | 6,105 | – | – | 6,105 |
| New Zealand fixed interest | – | 23,678 | – | 23,678 |
| New Zealand cash | 15,249 | 17,193 | – | 32,442 |
| Global bonds (fully hedged) | 24,443 | – | – | 24,443 |
| Global equities (50% hedged) | – | -150 | 32,440 | 32,290 |
| Total 2004 | 45,797 | 40,721 | 32,440 | 118,958 |
| Total 2003 | 41,561 | 37,675 | 27,025 | 106,261 |
The balance date figures above are reflected in the trust’s asset allocations:
| Policy (%) | Actual (%) | |
|---|---|---|
| New Zealand equities | 5 | 5 |
| New Zealand fixed interest | 20 | 20 |
| New Zealand cash | 25 | 27 |
| Global bonds (fully hedged) | 20 | 21 |
| Global equities (50% hedged) | 30 | 27 |
| 100 | 100 |
6. Taxation
| 2004 $(000) | 2003 $(000) | |
|---|---|---|
| Net surplus (before donations) | 13,987 | (6,117) |
| Less non-assessable income (Bay of Plenty Community Trust Charities Limited) | (4,213) | 1,869 |
| Less unrealised gains/losses | ||
| Russell International Share Fund | (3,688) | 5,616 |
| Tower Asset Management | (934) | 352 |
| State Street Global Advisors | – | (5,187) |
| 5,152 | (3,467) |
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Online Sources for this page:
VUW Te Waharoa —
NZ Gazette 2004, No 95
Gazette.govt.nz —
NZ Gazette 2004, No 95
✨ LLM interpretation of page content
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Bay of Plenty Community Trust Incorporated Financial Statements for the Year Ended 31 March 2004
(continued from previous page)
💰 Finance & Revenue17 June 2004
Financial Statements, Investment Gains, Expenditure, Net Surplus, Equity Movements, Financial Position, Bay of Plenty Community Trust